A third of mobile operator customers say they may move to non-traditional providers by 2021. What can they do to hold on to customers? New data suggests mobile video could help stop them leaving, at least in the mobile saturated millennial market.

A new survey of millennials from CSG International, a provider of revenue management solutions for telecom billing, suggests mobile video could be an opportunity for mobile operators. The company employed research firm Intengo to survey 958 18-35-year-olds in the U.S., U.K., Brazil, and Australia in February 2017.*

Mobile operators at risk

Millennial survey participants were asked where they thought they would be getting their wireless services from in 5 years. The survey gave respondents 3 choices: traditional wireless/mobile phone company, non-traditional provider like Google or Amazon, free sources such as public WIFI. Surprisingly, the survey found only a slight preference for traditional mobile operators. A third are comfortable with non-traditional providers, and 32% with free public WIFI. In the U.S. and U.K. significantly more millennials think they will be taking service from Google or Amazon. In Australia, significantly more think they will be using free public resources.

This should be concerning to mobile operators, with a third of their customers considering Google or Amazon as likely sources for wireless service in the future. However, video could be a significant opportunity for mobile operators to differentiate their service.

Worldwide, Cisco sees mobile bandwidth consumption increasing 7-fold through 2021. This growth is primarily driven by video, which will be 78% of the load in 5 years. As well, 97% of 18-24-year-olds and 90% of 25-24-year-olds have a smartphone, and the vast majority of both groups use it to watch video.

Personalizing the entertainment experience

Millennials are very open with their personal data, particularly when it comes to getting better recommendations for entertainment. 76% of those participating in the survey said they are likely to let providers use their mobile data to make entertainment recommendations. U.S. millennials are particularly willing to share this data, with 86% saying they would swap it for better recommendations. Brazilian and U.K. millennials were similarly motivated, with 80% and 77% says the same. Australians, on the other hand, were unwilling to share this personal, with just 23% willing to share the data.

Targeted ads an opportunity in the U.S., not the U.K.

Overall, 57% of survey participants said they are likely to let providers use their mobile data to target ads at them catering to their interests. Brazilian and U.S. millennials were, once again, the most comfortable with doing this, with 68% and 63% respectively.

Interestingly, though U.K. millennials are OK with operators targeting entertainment at them, they do not want them to do the same with ads. Just 23% say they are OK sharing their user data for this purpose. Even fewer Australian 18-35-year-olds are comfortable with it. Just 13% are willing to share data to receive more targeted ads.

Other opportunities in video

Mobile operators can also focus their attention on a couple of other video related services to entice new customers and retain existing ones. CSG says 57% of the survey group would spend more on their mobile service plan to get better quality media streaming experiences. In the U.S., there could be an opportunity to act as a unifier for video services. Half of respondents said they would be very likely to use a service exclusively if it provided access to all available video content.

Why it matters

A third of survey respondents say they could be using non-traditional wireless providers like Google and Amazon within 5 years.

One way mobile operators can add value, and stop customers moving to non-traditional players, is through video.

There are opportunities to add value through personalization, ad targeting, and improved video quality.

*The survey pool is a little small, particularly at the country-level. However, the results can provide some interesting guidance of the broader trends and opportunities.

One Comment

I suppose it isn’t surprising that ~66% of respondents expect to be getting mobile service for FREE or from a provider that doesn’t currently exist. I’d be more interested to dig into the thinking behind the other ~33% that seem to expect everything to be the same in five years as it is now.